The latest data from Singapore’s Accounting and Corporate Regulatory Authority (ACRA) reveals that Singapore company incorporation activity has declined by 3.6% in between Q2 and Q3 2011. The figures further deteriorated by 7% between Q3 and Q4 2011 and only 12,952 Singapore firms were registered during the last quarter of 2011.

Responding to the figures, Mr. Satish Bakhda, Head of Operations, Rikvin, said, “Although incorporation activity has naturally taken a hit as a result of a weakening economic outlook, the decline in incorporation activity is not as drastic as it appears. Furthermore, we need to remember that business activities are cyclical and long-term trends are presenting a stronger case for Singapore incorporation than short-term fluctuations.”

Over the past decade, Singapore’s biomedical sciences sector has grown significantly. Data from ACRA shows that the sector mushroomed from 17 companies in 2000 to 377 companies in 2010. According to the Singapore Indian Chamber of Commerce and Industry (SICCI), there were approximately 5,000 Indian companies in Singapore in 2011, up by 1,000 since 2010. Additionally, recently published data by the Singapore Economic Development Board (EDB) reveals that Singapore has continually seen an increase in fixed asset investments (FAI) year-on-year. In 2011, Singapore received S$13.7 billion in FAI, up from S$11.8 billion in FAI in 2009.

Analysis by Rikvin shows that some entrepreneurs opt to push on and start a Singapore company even in uncertain times because they recognize the long term benefits of investing through Singapore. In terms of dollars and cents, companies, especially those with subsidiaries, have greater potential to save significantly as they grow by registering in a low tax regime such as Singapore. Rikvin has recognized five features of Singapore corporate taxation that continually attracts businesses and investors to set up in the global Asian city – 1) low corporate taxes, 2) Productivity and Innovation Credit claims, 3) extensive network of tax treaties, 4) absence of capital gains tax and 5) no thin capitalisation or Controlled Foreign Corporation regime.

LOW CORPORATE TAXES

At 17%, Singapore’s corporate tax rate allows a spectrum of firms ranging from start-ups to holding companies to operate at a low cost. In the assessment year 2012, Singapore firms are set to benefit from a partial tax exemption scheme on the first $300,000 of chargeable income while eligible start-ups may qualify for full exemption. A holding company that is headquartered in Singapore may stand to enjoy lower corporate tax rates as well.

PRODUCTIVITY AND INNOVATION CREDIT (PIC) CLAIMS

The updated PIC scheme grants every Singapore firm a 400% tax deduction on the first S$400,000 invested in six productivity-enhancing and innovation activities. As demonstrated in Rikvin’s PIC Claims Chart, Singapore firms that plan their productivity and innovation strategies ahead of time could potentially reap up to S$9.6 million in tax savings on their annual taxable income.

EXTENSIVE NETWORK OF TAX TREATIES

Singapore firms stand to benefit from the nation’s extensive network of tax agreements. Singapore has to date established 69 comprehensive and seven limited Avoidance of Double Tax Agreements (DTAs). The Mutual Agreement Procedure (MAP) and Advance Pricing Arrangements (APA) provisions in Singapore’s DTAs in turn assure Singapore companies reduced taxes as they expand or conduct business across borders.

TAXATION OF INBOUND AND OUTBOUND DIVIDENDS

Singapore’s DTAs also have positive implications on the amount of payable withholding tax on inbound and outbound dividends. Singapore firms that receive dividends from their overseas subsidiaries often pay reduced withholding taxes in Singapore. Alternatively, if those dividends are taxed in the source jurisdiction and have a corporate tax rate of at least 15%, then those dividends are exempt from taxes in Singapore. Outbound dividends are exempted from withholding tax in Singapore.

ABSENCE OF CAPITAL GAINS TAX

Many DTAs accord and honor the taxing right of a parent jurisdiction. In the case of Singapore, capital gains are tax exempt. Therefore, Singapore holdings may repatriate overseas capital gains without being liable for taxes in Singapore.

NO THIN CAPITALISATION OR CONTROLLED FOREIGN CORPORATION (CFC) REGIME

Singapore is not a CFC regime. This in turn benefits Singapore holdings as the profits of their foreign subsidiaries will not be subject to Singapore tax. Singapore also does not have any thin capitalisation rules as it is a high-risk business strategy that could have a disastrous ripple effect for businesses and regional economies. The absence of the thin capitalisation rule assures businesses that Singapore is a stable place to do business.

“These tax features are designed to keep Singapore attractive as a business setup location for the long haul. Furthermore, during the recent World Economic Forum (WEF) talks, Prime Minister Lee Hsien Loong confirmed that Singapore’s upcoming Budget will remain committed to sustaining Singapore’s long-term competitiveness. Rikvin anticipates positive amendments that will complement these tax features and further buoy businesses through this year,” added Mr. Bakhda.

Related posts:

• Setup and Register Your Singapore Company in 60 Minutes!
• Setup and Register Your Singapore Company in 60 Minutes!
• Rikvin Singapore Seeks Strategic Partners For its Singapore Company Registration Setup and Business Visa Migration Service in India

In 2010 Singapore Budget, the Singapore Government finally introduced the Productivity and Innovation Credit (PIC) Scheme, a scheme that will strengthen the competitive edge of every business and will allow them to save on corporate taxes.

PIC Scheme has been enhanced in 2011 Singapore Budget. The objective of the enhancement is to straighten out the scheme so as to further encourage innovation and raise productivity efforts. The tax benefits under PIC will be effective from Years of Assessment YA 2011 to YA 2015.

Below are six activities along the innovation value chain that will qualify for PIC benefits.

1. Acquisition or leasing of PIC Automation Equipment – Costs incurred to acquire/lease prescribed automation equipment.
2. Training of employees – Costs incurred on In-house training (i.e. Singapore Workforce Development Agency (“WDA”) certified, Institute of Technical Education (“ITE”) certified; or All external training.
3. Acquisition of Intellectual Property Rights – Costs incurred to acquire IPRs for use in a trade or business (exclude EDB approved IPRs and IPRs relating to media and digital entertainment contents)
4. Registration of patents, trademarks, designs and plant varieties – Costs incurred to register patents, trademarks, designs and plant variety.
5. Investment in approved design projects – Costs incurred to create new products and industrial designs where the activities are primarily done in Singapore.
6. Research and development activities – Costs incurred on staff, costs and consumables for qualifying R&D activities carried out in Singapore or overseas, if the R&D done overseas is related to the taxpayer’s Singapore trade or business.

• For 1-5 activities: 400% allowance or deduction for qualifying expenditure subject to the expenditure cap, 100% allowance or deduction for the balance expenditure exceeding the cap

400% tax deduction for qualifying expenditure subject to the expenditure cap*.  For qualifying expenditure exceeding the cap for R&D done in Singapore, deduction will be 150%. For balance of all other expenses, including expenses for R&D done overseas, deduction will be 100%

For assistance on application of Productivity and Innovation Credit (PIC) Scheme, businesses may consult Rikvin, leading Singapore consultancy firm. Rikvin has developed a comprehensive tax claims chart to help Singapore entrepreneurs and firms enjoy 100% tax savings via the PIC scheme. Rikvin encourages businesses to take advantage of the 400% tax allowance to improve their performance at a low cost.

Related posts:

• Singapore Budget 2008 – Key Corporate Tax Reliefs At a Glance
• Singapore Budget 2008 – Key Corporate Tax Reliefs At a Glance
• Singapore Budget 2008 – Key Corporate Tax Reliefs At a Glance

According to data from the Singapore Commissioner of Charities (COC), the number of registered charities in Singapore has increased by 143% between the end of December 2001 and 2010. By the end of 2010, there were 2,028 charitable organizations in Singapore, more than two-fold of that in 2001 (834).

The latest annual report by COC also revealed that the total amount of tax deductible donations raised for local charitable causes registered S$776 million in 2010, signifying a 13% increase since 2009. Additionally, the latest data from the Ministry of Community, Youth and Sports (MCYS) reported that the number of community volunteers has increased by 29.5% over the decade – from 33,022 in 2000 to 42,778 in 2010.

In Singapore, every charitable organization and institution of public character (IPC) that conducts not-for profit activities to contribute to the good of the public or nation must be registered as a public company limited by guarantee in order to 1) engage in contractual agreements, 2) raise funds from non-members and 3) claim tax exemptions on funds raised. Furthermore, donors are more inclined to give to registered entities as they are legitimate and have been approved by the Singapore law to conduct operations.

Commenting on the observation, Mr. Satish Bakhda, Head of Operations, Rikvin, said, “Singapore is well-known as a financial and business hub and many who have not been here imagine it to be purely a money-making haven. However, the rise in not-for profit activity in Singapore over the past decade is an indication that more people are tuning in to philanthropic activities and deem the act of giving as a worthwhile pursuit.”

Further analysis by Rikvin shows that government support had a hand in spurring the registration of not-for profit entities over the past decade. First of all, the Singapore government committed to encouraging greater giving to IPCs by improving the donors tax deductions scheme in 2009. The renewed scheme, which was extended for five years, grants donors 250% in tax deductions for donations made.

Secondly, charities and IPCs could tap of the VWOs-Charities Capability Fund (VCF) to enhance their training, management, administrative and infocommunications setup needs at significantly subsidized rates. By March 2011, 780 charities and IPCs have improved their capabilities by taking advantage of S$8.7 million in VCF credits. Thirdly, the government has recently exempted charities with an annual income or expenditure under S$500,000 from financial auditing. This in turn eliminates auditing costs for organizations and allows them to utilize their funds to roll out worthwhile projects.

“Altogether, these funding and tax schemes demonstrate that the Singapore government stands firmly behind philanthropic activities and welcomes organizations that wish to contribute to the greater good of the community. We are confident that these schemes will continue to motivate more Singapore charities to be formed in the months to come,” added Mr. Bakhda.

Related posts:

• Incorporation of a Specialist Drug Development Company
• Incorporation of a Specialist Drug Development Company
• Singapore Company Registration Specialist in the Heart of Singapore Business District

A holding company is a firm that is set up specifically to 1) centrally manage the finances of a group’s subsidiaries, 2) hold or pool shares of a group’s subsidiaries and 3) receive dividends of the subsidiary companies and declare them to the group.

Singapore has long been seen as a highly-competitive and stable economy. Its business-friendly processes and advantageous tax policies have also contributed to its consistent top ranking as the easiest place to do business worldwide. Therefore, and in the face of the intensified fiscal crisis riddling the Eurozone this year, setting up a Singapore holding company would be a prudent investment for any discerning entrepreneur or key decision maker for years to come.

Commenting on the observation, Satish Bakhda, head of Rikvin’s operations said, “The global nature of business operations today presents a compelling case for setting up a holding company. A holding company gives a business leader clarity and peace of mind as it allows him to have a bird’s eye view of and track his group’s assets and shares. This macroscopic view in turn allows him to better grasp where the avoidance of double tax payments are possible. In the long run, a group could potentially save significantly in tax payments.”

A Singapore holding company, like all Singapore-registered companies, enjoys extensive tax benefits borne out of Singapore’s healthy bilateral relations with various economies as well as its simple domestic tax structure.

For one, Singapore has established a wide network of 69 comprehensive and seven limited Avoidance of Double Tax Agreements (DTAs). It has also inked 20 Free Trade Agreements (FTAs) with 26 trading partners and is in the process of negotiating eight more with economies like Canada and Mexico. These agreements not only pave the way for uninterrupted movement of business personnel and goods; they also extend tax privileges such as doing away with erroneous double taxation across borders.

Secondly, a Singapore holding company stands to benefit from the absence of capital gains tax in Singapore. This means that capital gains achieved from the sale of its investments in or outside of Singapore are tax exempt. Furthermore, many DTAs identify the taxing right on such capital gains to the holding company jurisdiction; if Singapore exempts capital gains from taxation, then the Singapore holding company need not pay taxes on the capital gains gotten from the sale of shares or investments.

Additionally, outbound dividends declared to foreign shareholders are not subject to the Singapore withholding tax. Singapore holding companies may also repatriate capital gains from overseas divestitures to their parent companies or group without being subject to taxation in Singapore.

Last but not least, having a Singapore holding company means having the ability to tap low corporate tax. At 17%, the Singapore corporate tax rate is one of the lowest in the world. It also comes with various tax incentives such as the partial exemption scheme on the first S$300,000 of normal chargeable income and concessionary tax rates under the regional headquarters scheme.

Related posts:

• Stemedica Incorporates Singapore Subsidiary with Company Registration Specialists Rikvin
• Stemedica Incorporates Singapore Subsidiary with Company Registration Specialists Rikvin
• Business Friendly Singapore, Says Singapore Company Setup Specialists

We are a global partnering company providing strategic support as well as tailored specialist consulting and services to selected organizations that wish to enhance their performance and bottom line.

Our talent alignment and search is targeted to improve the professional lives of an organization’s most important asset – its people.

We provide services and resources in the following areas:

• Business Advisory
• Organizational Development
• Restructuring
• Performance Improvement
• Consulting
• Temporary Staff Augmentation
• Talent Acquisition and Placement
• Training & Development
• Project or Program Management
• Strategy Development
• Strategic Vendor Management
• Outsourcing and Off Shoring

Why did you establish your Asian presence in Singapore?

ANKH’s coverage spans a global network at the highest levels of organizations. For this, the ANKH head office needed a secure, global, ethical and convenient hub with solid business protecting laws. Singapore therefore posed an ideal choice.

What are your goals in Asia?

To be the differentiating global partnering company where quality and value add drive the relationship rather than pure revenue. We also endeavor to bring professionals and organizations in the banking, technology, professional services and IT sectors together through networking sessions so as to enable them to add value to one other.

What was your experience of Rivkin?

I had prior experience with Rikvin and I’ve found that they are consistently flexible, informative and cost-effective. Rikvin’s specialists offer help in any way that they can to an organization setting up in Singapore. This in turn reduces the stress level and helps a company manage finite time more productively.

Related posts:

• Incorporate a Hedge Fund Management Company
• Incorporate a Hedge Fund Management Company
• Incorporation of a Boutique Global Consultancy

Rikvin is confident that the guide will help employees and employers quickly grasp and understand their rights and duties under an employment contract. This understanding would in turn enable both parties to negotiate fair and mutually-beneficial grounds for employment based on the Singapore employment act, Singapore’s fundamental labor law.

The Overview includes:

1. a brief explanation of the Singapore Employment Act as well as the parties it covers.
2. a brief explanation of what an employment contract is and what it should essentially constitute.
3. other important factors relating to an employment contract.

Rikvin’s guide also lays out eight salient features of an employment contract namely:

1. the designation title and job scope.
2. employee’s commencement date and employment period.
3. hours of work.
4. probation conditions.
5. remuneration package.
6. employee benefits.
7. code of conduct.
8. conditions for termination.

Commenting on the Overview, Mr. Satish Bakhda, Head of Rikvin’s Operations, said, “We have observed that many young entrepreneurs engaging our Singapore company registration services would like to draft fair Singapore employment contracts but do not know how to do so. Rikvin’s Overview of the Singapore Employment Act is a one-stop checklist that gives owners of small enterprises the most important components to draft fair employment contracts. On the other hand, the same guide provides an employee with a concise reference point with which he can check against the terms of his employment contract.”

Furthermore, the Overview is aligned with the recommendations laid out by the Tripartite Alliance for Fair Employment Practices. Drafting a fair employment contract is the first step to establishing a respectful working relationship with an employee, regardless of the type of Singapore work visa he is holding. A fair employment contract is also one of the first documents shared between an employer and a potential employee. As the contract is an extension of the company brand, it is then of utmost importance to begin the relationship on the right foot, even if it does not come to fruition.

To view the complete guide, please visit the Overview of the Singapore Employment Act page.

Related posts:

• Press Releases
• Overview of the Singapore Employment Act
• Rikvin Launches Singapore Employment Pass Guide on Its Portal

However, according to a recent news article, the number of Singapore permanent resident (PR) applications approved under the Professionals, Technical Personnel and Skilled Workers Scheme (PTS Scheme) have plummeted by 58.7% between 2009 and 2010. Deputy Prime Minister and Minister of Home Affairs, Mr. Teo Chee Hean confirmed that only 11,161 PR applications were approved in 2010. In comparison, 27,042 PR applications were approved in 2009.

The article also revealed the profiles of applications that were approved under the PTS Scheme between 2005 and 2010. In gist, out of all the approved PR applicants during this period:

• 83% are diploma or university graduates;
• 56% are 30 years old or younger; and
• 43% earn at least S$4,000 per month.

Additionally, 85% of the successful applicants received their PR status five years after residing in Singapore via the Singapore employment pass, long-term visit pass (LTVP), work pass, dependant’s pass and student pass.

Analysis by Rikvin shows that the following three factors – acceptable salary, age and education – are crucial to securing the Singapore permanent residency status and in fact serve Singapore’s human capital and societal needs.

For one, having more residents who are diploma or university graduates dovetails with the national strategy to increase the quality of its workforce as they can fill professional-level vacancies and complement the workforce.

Secondly, as Singapore has an ageing population, having more residents who are younger means having a more productive and future-ready workforce. In turn, granting young foreign professionals the PR means that they can set up homes in Singapore. This translates to the possibility of building families and mitigating the low birth trend that Singapore has been facing for years.

Thirdly, having residents earning more than S$4,000 a month, which was the qualifying salary for a P2 Employment Pass w.e.f 1 July 2011, is consistent with the national aim to attract more high-calibre professionals to Singapore. Furthermore, having a higher salary means having the ability to meet the rising costs of living in Singapore.

On a macroscopic level, the ability to meet these requirements mean that applicants have proven that they have the means to reside in Singapore and not fall through society’s cracks. Singapore does not have a dole system and will never be a welfare state. Approving the application of potential residents who can independently earn a living and sustain their livelihood will in turn ensure that Singapore as an economy does not incur unnecessary societal debt. This then ensures a lower societal burden for all and for years to come.

Related posts:

• Singapore Permanent Residence
• FAQs on Permanent Residence (PR)
• Singapore’s new immigration policy makes work permits tougher for Indian workers with middle-level skills

The leading biotech company has over 30 years of stem cell research to its name and is committed to developing and manufacturing US cGMP (Current Good Manufacturing Practices) grade allogeneic adult stem cell products. Stemedica’s products would in turn help medical institutions and pharmaceutical firms develop drugs for severe neurological, dermatological, cardiac and ophthalmological conditions such as Alzheimer’s and Parkinson’s disease, spinal cord injury, central nervous system damage, stroke and diabetic retinopathy.

Prior to setting up its Singapore subsidiary, the biotech firm has manufacturing facilities in Lausanne, Switzerland and Seoul, Korea. Stemedica Asia was established in Singapore, out of all Asian cities, for its transparent business processes and strategic location which facilitates the serving of the regional market’s needs. In addition, Singapore proved to be a natural choice for Stemedica, which is headquartered in San Diego, California as Singapore’s regulatory business practices could easily be coordinated with US audit needs.

Commenting on Stemedica’s decision to engage the services of Rikvin, Ms. Amy Sanson, General Manager of Stemedica Asia said, “One of my Singapore-based business partners had a legal counsel who could’ve helped me with the incorporation of Stemedica Asia. However, as I was in the United States, he recommended Rikvin, saying that it would be best to work with a Singapore company registration services company that has a very strong presence online as well as offline.”

“My experience with Rikvin has been very positive. I was pleasantly surprised that Rikvin, without failure, has answered all my queries promptly, no matter how insignificant they were. Best of all, I had several expert teams assisting me regarding incorporation and Singapore Employment Pass issues but I did not feel lost in communication as Rikvin presented me with a dedicated manager who excellently communicated and oversaw all activities. I have been very satisfied with the level of service as well as speed and ease of working with Rikvin. Eventually, I recommended Rikvin to a partner who ended up engaging their services due to its online presence and reasonable pricing,” added Ms. Sanson.

Moving forward, Stemedica Asia plans to set up a supply chain center in Singapore to market and distribute its best in class cell products across Asia. It also has plans to work with Singapore scientific resources to set up a cell and cell product distribution center.

Commenting on Stemedica Asia’s presence in Singapore, Satish Bakhda, Head of Operations, Rikvin, said, “In light of the immense value that Stemedica offers to the medical institutions and researchers in Singapore, we are confident that Stemedica Asia will contribute positively to the lives of the larger global community, especially those affected by severe conditions. We look forward to Stemedica Asia’s continued growth in Asia.”

Related posts:

• Registration of a Subsidiary Company from Dubai
• Registration of a Public Listed Subsidiary Company
• Rikvin Singapore Seeks Strategic Partners For its Singapore Company Registration Setup and Business Visa Migration Service in India

One of the measures taken to raise the quality of foreign manpower inflows was reflected in the more stringent qualifying requirements for the Singapore work visa. The changes, which were implemented with effect of January 1, 2012, requires new and returning applicants to give proof of acceptable educational qualifications and professional background as well as higher minimum salaries.

Recent news articles have shown that this measure has not been popular with many small enterprises in Singapore.The overarching concern for start-ups has been that the more stringent requirements effected since July 2011 have made it more difficult for them to hire in sectors such as manufacturing, retail, F&B and construction. However, according to Rikvin’s analysis of Singapore work permit applications between 2010 and 2011, the new requirements have not deterred high-calibre professionals and entrepreneurs from going for a chance to work and live in Singapore. Between 2010 and 2011, Rikvin has seen a 25.7% increase in the total number of Singapore work visa applications.

What needs to be understood here, is that the introduction of tighter Singapore employment pass requirements is only a part of and not the only strategy employed to ensure that Singapore’s workforce is future-ready. To brace the workforce for a potentially tough year ahead,  the Ministry of Manpower (MOM) is also working closely with the Workforce Development Agency (WDA) and the Employment and Employability Institute (e2i) to roll out education and training programs that will help Singaporean workers remain competitive in the job market and upgrade their skills for higher level positions.

Additionally, and to address rising concerns over unfair employment practices, the Tripartite Alliance for Fair Employment Practices (TAFEP) has enhanced and issued the Fair Employment Practices Guidelines in October 2011. The guidelines seek to ensure that Singapore workers are not marginalized in their own country and are presented with a more level playing field to compete for jobs as well as development and promotion opportunities based on merit.

Rikvin supports Singapore’s manpower strategy and believes that it will contribute to the greater good of the Singapore workforce as a whole and competitiveness for the long run. Implementing clear and fairer employment guidelines sends a signal to entrepreneurs and professionals worldwide that Singapore does not tolerate unjust practices in the workplace and this could in turn attract businesses to opt for Singapore company registration. Raising the productivity bar for both foreigners and Singaporeans alike shows that no one is spared from stepping up their game in Singapore and that it is necessary to do so, given the heightened level of competition we are facing as an open economy and global city. While the year looks uncertain, these manpower plans are indeed a timely step in the right direction.

Related posts:

• Singapore – Foreign Manpower Quota Increased
• Rikvin Secures Singapore Employment Agency (EA) License from Ministry of Manpower
• Singapore Government Launch Web Portal Gebiz

Related posts:

• Form a Singapore Company With Rikvin, Incorporate a Singapore Company Now!
• Incorporate a Trading Company
• Incorporation of a Cosmetics Company